The federal government is planning to temporarily remove sales tax on groceries and other selected items ahead of the holidays.
The Liberal government announced on Thursday that it will introduce legislation to drop the Goods and Services Tax and Harmonized Sales Tax from December 14, 2024, to February 15, 2025.
If the legislation passes, the new tax break will apply to:
- Prepared foods, including vegetable trays, pre-made meals and salads, and sandwiches.
- Restaurant meals, whether dine-in, takeout, or delivery.
- Snacks, including chips, candy, and granola bars.
- Beer, wine, cider, and pre-mixed alcoholic beverages below 7 per cent ABV.
- Children’s clothing and footwear, car seats, and diapers.
- Children’s toys, such as board games, dolls, and video game consoles.
- Books, print newspapers, and puzzles for all ages.
- Christmas trees.
The government said removing the GST from qualifying items for two months is expected to provide an estimated $1.6 billion in federal tax relief.
In addition, the federal government will be introducing legislation to provide a new $250 Working Canadians Rebate to 18.7 million Canadians in early spring 2025. If passed, all Canadians who worked in 2023 and earned less than $150,000 net income will be eligible.